Opinion: Use the Free Direct File in NC
Apr 23, 2025
Then comes the upsell – would you like to talk to a real person about your tax situation? That’ll cost you extra. Do you owe taxes to the government? First, pay us so we can tell you how much you need to pay to the government. It doesn’t make sense to me.
I can’t help you with finding your login information, but this tax season will be cheaper for NC taxpayers thanks to Direct File. Instead of worrying about tax prep services, there’s now a free, straightforward option. This year, more than 1.6 million North Carolinians are eligible to use Direct File – a new way to file your taxes directly with the government, for free. It’s a more accessible and cost-effective way for people to do their taxes, especially those who have relatively simple returns and claim common credits and deductions.
After a preliminary 12-state pilot program in 2024, Direct File is now an option for qualifying taxpayers in 25 states, including North Carolina. This year, over a third of North Carolinian taxpayers are now able to use Direct File to file their federal and state tax returns for free. Direct File didn’t just appear one day in North Carolina.
Despite its benefits and popularity across 12 pilot states, there is opposition to Direct File and barriers to people even learning about this free filing method.
Widely Popular But Little Marketing
By now, you’ve probably been inundated with advertisements for the big, for-profit tax preparers—but this may be the first you’re hearing of Direct File. That’s because, despite its successful Pilot and broad popularity, the advertising
output and investment around Direct File is limited. Especially in comparison to the millions of dollars being poured into promotion by for-profit tax preparers.
Take TurboTax, for instance: They have the budget to advertise during the Super Bowl, and although we don’t know the exact cost of the latest TurboTax Super Bowl ad (featuring actress Issa Rae), we do know that advertisers paid an average of $8 million for a 30-second commercial during the 2025 broadcast.
TurboTax’s parent company, Intuit, made $16.3 billion in 2024, which is a marker of just how much money these middlemen tax preparers make from U.S. taxpayers who probably aren’t aware of Direct File as a free, user-friendly alternative. It’s tough for Direct File to compete in such a competitive climate.
The Benefits of Using Direct File to Do Taxes
Direct Recent research shows that Direct File saves Americans $11 billion annually, saves $3 billion in time costs and potentially delivers $12 billion more in currently unclaimed tax credits for low-income families. This is bolstered by how it accepts most common credits and returns—including child tax credit and earned income tax credit—to increase accessibility. As an additional way to make the program more accessible, Direct File is also available in English and Spanish.
Following the Pilot program that ran from February-April 2025, the U.S. Government Accountability Oce (GAO) shared that over 140,000 tax submissions were accepted by the IRS via Direct File. Of these, 24% had income under the poverty guidelines. This is a testament to how the system can help low-income taxpayers cut costs and save cash by eliminating the expense of third-party tax firms.
The GAO data also revealed that 33 was the average age of those who filed their taxes electronically through Direct File during the Pilot. This suggests that it has been successful in appealing to younger generations of taxpayers who want to abandon the old way of doing things in favor of a quicker, more affordable alternative way to do their taxes.
I can also speak personally to these benefits. I used Direct File for my family’s taxes this year. Tax season for me was cheaper, easier, and less of a headache than previous years when I used online for-profit tax preparers.
Direct File is Under Attack
Even though its benefits are numerous and the majority of U.S. taxpayers are in favor of Direct File, its opposition is jeopardizing its success. Large tax preparation companies are well-established in the industry — they’ve been around from the beginning, making it hard to shift without significant effort.
Since its conception, there has been an (unsuccessful) bill introduced to try and dismantle Direct File and more recently, political moves to close the 18F oce, which is the group behind the development of Direct File. However, recent polling suggests that the Trump Administration would experience harsh public blowback if it were to get rid of Direct File.
A YouGov poll showed that 63% would oppose the decision to eliminate Direct File. So, it’s clear that there is broad support for the service but undoubtedly, a great deal of confusion about its future.
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